Business analysis of buffalo dairy farm : case study of Murrah Farm, Plaengyao District Chachoengsao Province, Thailand | |
| Author | Chanerin Maneechansook |
| Call Number | AIT RSPR no.AB-10-01 |
| Subject(s) | Competition Dairy farming--Thailand--Chachoengsao Milking--Thailand--Chachoengsao Buffaloes--Milk yield--Thailand |
| Note | A research study submitted in partial fulfillment of the requirements for the degree of Master of Agri business Management, School of Environment, Resources and Development |
| Publisher | Asian Institute of Technology |
| Series Statement | Research studies project report ; no. AB-10-01 |
| Abstract | Rearing buffalo for milk seems to be a strange idea for farmers, and milk drinking culture in Thailand mostly relied on cow milk. However, the first and only buffalo dairy farm was established in 2003 namely Murrah Farm which located in Plaengyao District, Chachoengsao Province. The purpose of this study was to analyze the possibility and viability of buffalo dairy farm establishment in five aspects including marketing, procurement, processing, finance and competitiveness. Both qualitative and quantitative methods were applied in the study. Data was collected by in-depth interview the owner of Murrah Farm and observation the farm operation. In addition to competitive market assessment, interview with Saudi Farm, representative of goat dairy farm, and 20 customers of buffalo milk retailer were conducted. The results of the study revealed a moderate competition in buffalo dairy market. Although there was no direct competitor, various substitution products such as cow milk, soy milk and goat milk were available in market with lower price, and no switching costs for consumers in changing to other substitute products. Primary target market was consumer in working age who had high education, income and self decision. Buffalo breeds in Murrah Farm were Murrah, Swamp and cross breeding of Murrah and Swamp. The farm planed to have 200 milking breeders. Average milk yield was 5 kg/head/day. Lactation period was 250 days. Buffalo were fed with grasses and baby corns that planted in the farm areas by cut-and-carry system. Concentrate was supplement feeds for milking buffalo. Milk processing plant was located in the farm areas. Raw milk was processed daily to produce four dairy products including pasteurized milk, yogurt, mozzarella cheese and ghee. Processing processes were uncomplicated since machineries and equipments were operated manually. To start up buffalo dairy farm required high investment costs and business life was determined at 20 years according to useable life of fixed assets. A forecasted financial return on investment for 20 years (2003-2022) indicated that the Net Present Value (NPV) was 9,045,420.30 Baht, Benefit-Cost ratio was 1.14 and Internal Rate of Return (IRR) was 8.60%. The results of sensitivity analysis indicated that Murrah Farm could maintained its operation profitably even when production costs increased 20% and earned income decreased 10%. In case an increase of production costs and decreased of earned income happened simultaneously, the farm could endured at 5% of the double effects. Payback period was 15 years and 4 months. The principal conclusions were that there was possibility to start up and run buffalo dairy farm viably, however farm owner had to have big capital budget for investment and be patient to wait for good return in a long run. It is recommended that milk yield and channel of distribution are important issues need to be developed for increase production capacity and revenue. Further research is also recommended to study on market strategy and consumer’s behaviors for market expanding and creating better perception on consumers towards buffalo milk. |
| Year | 2010 |
| Corresponding Series Added Entry | Asian Institute of Technology. Research studies project report ; no. AB-10-01 |
| Type | Research Study Project Report (RSPR) |
| School | School of Environment, Resources, and Development (SERD) |
| Department | Department of Food, Agriculture and Natural Resources (Former title: Department of Food Agriculture, and BioResources (DFAB)) |
| Academic Program/FoS | Agribusiness Management (AB) |
| Chairperson(s) | Soni, Peeyush; |
| Examination Committee(s) | Athapol Noomhorm;Anal, Anil Kumar; |
| Scholarship Donor(s) | The Royal Thai Government Fellowship (RTG); |
| Degree | Research Studies Project Report (M.Sc.) - Asian Institute of Technology, 2010 |